Off-season in Europe creates conditions for moderate increase in natural gas prices

04 April 2024 119
Off-season in Europe creates conditions for moderate increase in natural gas prices

On Thursday, natural gas prices showed a weak growth after a decline the day before. Gas market goes into an off-season stage, so there is a stabilization of prices.


The heating season is coming to an end in Europe, and some gas storage facilities have already started to switch to gas injection mode, surpassing the levels of record reserves left over from the winter.


Since March 30, injection of gas into storage facilities in the EU countries began to exceed its withdrawal. According to Gas Infrastructure Europe (GIE) data, on March 31 and April 1, daily gas injection outpaced withdrawals by 211 million and 99 million cubic meters, accordingly. As a result, at the end of the heating season, the storage volume reached a new record of 63 billion cubic meters, which exceeded last year's high of 59 billion cubic meters.


Austria and Germany stand out among the countries that were the most efficient in maintaining reserves. France experienced increased gas consumption during the winter. By the end of the season, the occupancy of French gas storage facilities dropped to 39%, reaching the level of 4.8 billion cubic meters.


On average, gas storage facilities in all EU countries were 58% full at the start of the injection season.


The beginning of gas injection into European storage facilities may create conditions for an increase in demand for gas. However, this is limited due to the high level of gas storage capacity.


On the technical level, natural gas quotes are in the formation of an upward corrective trend on the H4 timeframe.


In terms of wave analysis, the price is in the formation of the third ascending wave on the H2 time frame. The breakthrough of the top of the first wave at 1.884 has already taken place. This may strengthen the bullish movement in the near term. The Stochastic Oscillator moving indicators (standard values) have left an oversold zone, which may strengthen growth within a correction corridor.


Signal:

The short-term outlook for Natural gas is to buy.

The target is at the level of 2.110.

Part of the profit should be fixed near the level of 1.945.

A Stop-loss should be placed at the level of 1.740.

 

The bullish trend has a short-term character, so the trade volume should not be more than 2% of your balance.

This content is for informational purposes only and is not intended to be investing advice.

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